Israeli soldiers have shot dead a Palestinian woman who had rammed a vehicle into a parked car near an Jewish settlement in the occupied West Bank, injuring two people sitting inside, the army has said.

The Palestinian health ministry identified the alleged attacker on Friday as Majd al-Khudur, from Bani Naim town, which is close to the scene of the incident, but gave no details surrounding her death.

The military said in a statement that the woman "accelerated and crashed into a stationary vehicle" at the entrance to the settlement of Kiryat Arba.

The statement also said that the wounded Israelis, a couple in their 50s, were taken to a hospital in Jerusalem.

Friday's incident is the latest in nine months of dozens of Palestinian attacks, including stabbings, shootings and assaults using cars, but in many cases the Israeli soldiers have been accused of using excessive force in dealing with alleged attacks by Palestinians.

The Kiryat Arba settlement is near the West Bank city of Hebron, which has long been a flashpoint in the Israeli-Palestinian conflict.

A few hundred Jewish settlers live under heavy army guard among several hundred thousand Palestinians in the heart of the West Bank's most populous city.

Settlements are considered illegal under international law and are a major sticking point for peace efforts between Israel and the Palestinians.

In a wave of violence since October, the Israeli army has killed at least 210 Palestinians, including protesters, bystanders and alleged attackers, while 32 Israelis have been killed in stabbing and shooting incidents.

Palestinians are frustrated by Israel's 48-year occupation and with peace talks going nowhere.

The latest cycle of violence began with a dispute over access to the site of the al-Aqsa Mosque compound - Islam's third holiest site.

Palestinians are concerned at the increase in Israeli calls for and attempts to pray at the mosque courtyard - which Jews call the Temple Mount and consider their holiest site, and Muslims refer to it as the Noble Sanctuary or al-Haram al-Sharif.